Most industries have their fair share of misbeliefs and misconceptions around what they provide and how they work—and the insurance industry is no exception. You might be surprised how many insurance “facts” you’ve been adhering to are actually, well, myths. In our new series, we’re hopping in Elephant’s Mythbuster Machine to take on some of the biggest, sneakiest mysteries around car insurance. So buckle up, it’s time to take The Mythbuster Machine out on the road!

The Myths

Car insurance rates go down when you turn 25.

Yep, generally they do, but it’s not as big a drop as you may think. Our data and research found the biggest drop is actually at a different age. Discover what ages see the biggest reduction in price and what goes into determining how insurance is priced for younger drivers.

The color of my car may raise my insurance rate.

Generally speaking, this isn’t true. Your car insurance provider will not directly factor in the color of your car when determining your premium. It can, however, have indirect effects. See how color can affect the cost of your insurance, as well as other aspects of your vehicle.

My car insurance covers items stolen from my car and/or vandalism.

If you have Comprehensive Coverage on your policy, your insurance will cover vandalism or a stolen car, but your car insurance won’t cover items stolen from inside your car. However, your homeowners or renters insurance should!

My credit score doesn’t affect my car insurance rate.

Your credit score is just one of the many factors considered by an insurance provider when determining your rate, but it can have a pretty significant impact. Let’s review what goes into a credit score, how to maintain a good score, and understand how your score effects your insurance rate.

I’m not responsible if someone else drives my car and gets into an accident.

This is really only true if your car was stolen and the thief gets in an accident. If you give someone permission to drive your car, and they’re at-fault in an accident, you and/or your insurance will be on the hook for the bill. But don’t worry, you and your friend can make sure you’re covered. With the right plan, your insurance can protect you if you often loan your car.

Tickets won’t increase my car insurance rate.

This myth is a little murky. The truth is they can, but it very much depends on the violation. For example, a DUI ticket will have a much larger impact than something like a ticket for an improper turn. Let’s review how common tickets and violations can affect the cost of your car insurance.

My rate won’t go up if I’m not at-fault in an accident.

Most of the time this is true, but there are some exceptions, like if you have a history of no-fault accidents. If you’re not totally sure what this means, don’t worry! Elephant explains it all—being at-fault, not at-fault, and how it affects your insurance.

Comprehensive Coverage covers everything.

This myth gets a big fat “false” from us! Comprehensive covers a lot, but it doesn’t cover things like colliding with a car or object. To fill in the gaps of Comprehensive, you also need Collision Coverage. But what do they both, and do you need to have them? Check out our whole webpage dedicated to this dynamic duo.

Location doesn’t play a role in my car insurance rate.

Contrary to what you might think, location can absolutely affect your car insurance rate, from what kind of weather your area sees to how frequently accidents happen in your neighborhood. Find out how location and other factors of your surroundings can affect your premium.

Car insurance will always pay for a rental car after an accident.

Nope, nope, nope. As much as you might wish this cool coverage came automatically, rental reimbursement coverage is an add-on to your existing policy, and it has to be added before you get in an accident to apply. There are also a few more stipulations as to what you need to get this coverage, and once you do, you’ll realize it’s a big help at a small cost.

This article is intended for informational purposes only. It does not replace or modify the information contained in your insurance policy and may not reflect the official policies of Elephant Insurance or current developments.

Article last updated on November 15th, 2024 at 1:08 pm